The NZD/USD pair continues to find support ahead of a technically significant 200-day Simple Moving Average (SMA) and attracts some buyers in the vicinity of the 0.6200 mark on Thursday. The pair sticks to its modest intraday gains through the early European session, albeit lacking bullish conviction and struggling to capitalize on the move beyond the 0.6250 level.

The pair may have formed a double top bearish reversal price pattern since the beginning of December 2022, the neckline of which lies at 0.6200. A clear breakdown of that level - the pattern's neckline - on increased US Dollar strength, would usher in a new much more bearish phase for the pair and suggest a run down to targets at 0.5990 and 0.5860. The double layer of support from the 200 and 100-day Simple Moving Averages (SMA) at 0.6220, however, currently underpins price action for now and would require a major fundamental driver to break.

The Kiwi asset has successfully shifted its auction above the 50-period Exponential Moving Average (EMA) at 0.6233 on intraday note, which indicates more upside ahead after a short recovery on lower degree of trends.

Meanwhile, the Relative Strength Index (RSI) (14) is on the verge of delivering a break into the bullish range of 60.00-80.00, which will trigger the upside momentum on minor degree of trends before proving to be hawkish on H4 and daily.

Downward momentum is fading quickly but as long as 0.6285 (no change in ‘strong resistance’) is not breached, there is still a slim chance for NZD to break below 0.6195. Looking ahead, if NZD were to break clearly below 0.6195, the next level to monitor is at 0.6150

NZDUSD to provide a sideways recovery before breakout

Feb 23 2023

Stop Loss -1.03%

Holding time 3d8hr

0.62142

Entry price

0.61502

Stop loss price